CENTRAL BANK OF INDIA Vs. A KOTEESWARAN

JUDGEMENT

(1.) THIS revision arises out of the Order in RCA No.30/1998 of Rent Control Appellate Authority/Sub Court, Villupuram, fixing the monthly rent at Rs.31,450/-. In RCOP No.14/1996, the Rent Controller had fixed the monthly rent at Rs.41,500/-.

(2.) BRIEF facts are as follows :- 2.1. The Petitioner Bank took the premises Door No.99, Mahathma Gandhi Road, Villupuram, on lease from the original owner under a registered lease deed dated 21.11.1990. The Bank occupies the entire ground floor 3860 sq.ft. and 565 sq.ft. in the first floor and the remaining extent of the first floor is occupied by the Income Tax Department. 2.2. The Respondents/landlords purchased the premises from the original owner an undivided half share under Exs.P-3 and P-4 [dated 3.4.1991] for Rs.3,47,000/- each making a total of Rs.6,94,900/-. Land value = Rs.1,76,778/-, building value = Rs.1,47,164/- with a lane valued at Rs.23,058/-. The value of the site 3,864 sq.ft. was Rs.3,53,556/-. After the purchase, the Respondents accepted Ex.R-4 - lease deed under Notarized affidavits executed by them. 2.3. In 1994, the Respondents claimed higher rent of Rs.12,600/- p.m. and the claim was resisted by the Petitioner Bank. On 24.11.1995, the Respondents issued Ex.R-3 - Notice claiming higher rent of Rs.16,800/- p.m. and the same was resisted by the Petitioner Bank as unreasonable. On 05.07.1996, the Respondent issued Ex.P-1 Notice claiming a rent of Rs.40,000/- p.m., for which the Petitioner/Bank has sent Ex.P-2 reply. On 08.08.1996, RCOP was filed under Section 4 of the Tamil Nadu Buildings [Lease & Rent Control] Act [for short, the Act] for fixation of fair rent, which was claimed at Rs.43,390/- p.m. 2.4. In consideration of the evidence, the Rent Controller calculated the fair rent at Rs.41,500/- as under ::- For the entire extent of 3860 sq.ft., site value was fixed at Rs.740/- per sq.ft. at Rs.28,56,400/-. Total value of the site and building was thus calculated at Rs.40,70,266/-. To this was added 2% for Schedule I amenities at Rs.81,405/- making a total valuation of Rs.41,51,671/-. On this basis, the monthly rent was fixed at Rs.41,500/-. 2.5. The Appellate Authority fixed the fair rent at Rs.31,450/- as under - For basic amenities, the Appellate Authority allowed 5% instead of 10% and increased the deprecation value to 1% for 16 years and thus fixed the value of the building at Rs.10,48,068/-. The Appellate Authority took the land value at Rs.724/- per sq.ft. based on Ex.A-7 Sale Deed of 14.04.1996 and fixed the land value at Rs.27,94,640/- and disallowed any further deduction towards Schedule I amenities. Thus the total value was fixed as Rs.31,42,708/- [sic] and thus fixed the monthly rent at Rs.31,450/-.

(3.) AT the outset the unreasonableness of the demand of rent is to be pointed out. Immediately after the term is over i.e. in 1994, the Respondent claimed a higher rent of Rs.12,600/- p.m. Ex.R-3 Notice [dated 24.11.1995] was issued by the Respondent claiming a higher rent of Rs.16,800/- p.m. Even eight months thereafter, i.e. in July 1996, the Respondents issued Ex.P-1 Notice claiming an exorbitant rent of Rs.40,000 p.m., which is nearly 2 times of rent what was claimed under Ex.R-3. The Petitioner/Bank had sent Ex.P-2 reply referring to the terms of the lease that the lease was for a period of five years certain, with option to renew for a further period of five years with interest of 20% in the rent payable and the amount claimed is not in consonance with the prior payments of Rs.11,600/- and Rs.16,800/-.